Archive for August, 2009

ANOTHER BIG CROP IN 2009?

Tuesday, August 25th, 2009

If you are like me, every year when you are out-and-about you pay attention to how the crops look.  These types of “windshield tours” can never tell you everything about how crops are going to turn out, but they can give you a bit of an indication of likely success for a crop year from one area to the next.

Fortunately, there are also some relatively scientific crop tours that occur every summer – one of which is the Pro Farmer Midwest Crop Tour.  This year’s Pro Farmer tour just concluded late last week, and the findings were clear – Iowa and Nebraska have the potential to harvest huge corn crops, and areas east of the Mississippi River are likely to be steady to slightly lower than the 2008 crop.  The still-present danger for the entire Midwest is an early frost or freeze, which would be devastating to yields in many crop producing areas because of the late planting dates and slow development all summer long as a result of cooler than normal conditions.  To hear a report of the crop tour for yourself, click here.

What do you think – did Pro Farmer get it right in reporting their findings for crop potential?  Send me an e-mail at doug@loranda.com to let me know how crops in your area will fare.

Source: www.agweb.com

2010 CASH RENT OUTLOOK

Wednesday, August 19th, 2009
In our post on August 11, we examined the USDA’s 2009 summary of cash rents.  As we discussed, the corn belt states saw increases in cash rent rates from 4.4% to 5.9% from January 1, 2008 to January 1, 2009.  These numbers were not too surprising when taking into account where the grain markets were at last summer.  However, with the current volatility in commodities markets, the outlook for 2010 is less clear.

A recent article by DTN/The Progressive Farmer examines the uncertainty in the market right now.  Many of the operators and landlords interviewed in the article foresee rent levels either holding steady or slightly decreasing.  At this point, there are a lot of yet-to-be-determined variables that will determine cash rent levels for 2010.  Yields from the 2009 harvest, grain prices, 2010 input prices & the level of competition from other local operators will all contribute to what prices landlords and tenants agree to for 2010.

Read the entire article, here.

What price level will cash rents be in your area in 2010?  Let us know at eric@loranda.com!

Source: DTN/The Progressive Farmer

USDA 2009 SUMMARY OF LAND VALUES AND CASH RENTS

Tuesday, August 11th, 2009

The U.S. Department of Agriculture recently released its 2009 summary of land values and cash rents.  According to the report, U.S. cropland values decreased 3.9%, or $110 per acre, from the 2008 report.  Some state-specific statistics:

  • Illinois – 3.7 % decrease to an average value of $4,670/A
  • Iowa – 4.9% decrease to an average value of $4,050/A
  • Indiana – 4.6% decrease to an average value of $3,950/A

Across the U.S., cropland cash rents rose at average rate of 5.3%.  Some state-specific cash rent statistics:

  • Illinois – 4.3% increase to $170/A
  • Iowa – 5.9% increase to $180/A
  • Indiana – 4.4% increase to $141/A

Download the full report, here.

Source: USDA

CASH FOR CLUNKERS VS. ETHANOL

Tuesday, August 4th, 2009

You’ve likely heard a lot in the news in recent days about the “Cash for Clunkers” auto sales program, sponsored by our Federal Treasury.  The program has been so “successful” in giving away money to support the auto industry that it’s already spent its $1 billion budget in a matter of just over a week.  As a result, members of Congress are now clamoring for more money to keep the program alive.  Where’s the new money going to come from, you ask?  From stimulus dollars, initially targeted to support the ethanol industry.  With this possible action, our members of Congress are proving to the public that what can be given with the stroke of a pen, can also be pulled with a new stroke of the same pen.  See the article here.

Source: DTN

What do you think – is spending more of your tax dollars in additional support of the auto industry a better use of funds than ethanol?  Should money be spent on either sector?  Let me know by e-mailing me at doug@loranda.com.

THE APRIL 1986 LAND MARKET

Monday, August 3rd, 2009

I read a lot. Books, magazines, newspapers, and online news. And every once in a while, I come across a piece that makes me stop and really think.  Recently, I came across one such news article from an April 1986 Fortune Magazine that concerned the farmland market.  Heavy debt loads, high interest rates, and too much speculation created a toxic environment for farmland during that era.  And based on the general health of the agricultural sector in today’s world, we seemed to have learned our lesson.  However, I thought you might be interested in reading a piece of history.  To read the article, click here.

Source: CNNMoney